Investors await US labor market data update
03 December 2021
Volatility has been minimal so far on Friday as markets are bracing for today's important US macro data.
Later today, October's euro zone's retail sales are due, expected to halve to 1.2% year-on-year from 2.5% in the previous month. The monthly change should tick higher to 0.2% from -0.3% previously.
However, the most focus will be on today's US nonfarm payrolls. The US economy is expected to show 550,000 new jobs for November, slightly above 530,000 in October. As a result, the unemployment rate should improve marginally to 4.5%.
Substantial numbers should encourage the Fed to quicken the tapering pace and start raising rates in June, possibly boosting the USD in the initial reaction to the data.
Precious metals look vulnerable and could continue lower as gold dropped to one-month lows at 1,770 USD, while silver is at two-month lows near 22.30 USD.
From other news, the OPEC+ group surprised investors by sticking with the plan to boost production by 400,000 barrels per day in January. Still, the top producers also said they could meet again before their next scheduled meeting on January 4, if needed.
Oil plunged in the initial reaction, but the dip was quickly bought and the WTI benchmark closed Thursday with a large bullish pin bar, indicating the decline might be over. The next target remains at 70 USD, where the 200-day average is.
US stocks staged an impressive rally yesterday, but gains are fading today as equity benchmarks are circa half a percent lower during the EU session. However, everything will be decided after today's data.